The US & Global Economic Trades

Changes in the economic trade between the United States and the world are constant. The ability to change over this constant rate helps to separate successful companies from the country (Kotter, 2012). The United States and South Korea are examples of countries that have undergone transformation in the past 50 years. The United States continues to be more specialized, but Korea has completely transformed from a wasteful economic point of view ("Korea Education", 2013). GDP in the US is slowing down, but it is still very popular as a trading partner (due to consumption and economic well-being).

The First World War hampered these advances in economic globalization. Most of the world's economic powers have introduced trade barriers that build protectionist economic policies and stagnate the growth of trade. This led to a slowing of world trade and even even the introduction of immigration cap in other countries. It was not until the 1970s that globalization began to fully recover when the government began to emphasize the benefits of trade. Today, technology follow - up has brought about rapid expansion of world trade.

There are many factors behind the growth of world trade. Reducing transportation costs will reduce trade costs, technologies will completely eliminate some barriers and free economic policies will mitigate political barriers to trade. Cost saving helps accelerate trade, but the biggest driving force behind world trade is the desire to increase supply and demand economics, consumption of importers and exporters. The main advantage of globalization is the comparative advantage - the ability of the country to produce goods or services with lower opportunity costs than other countries. Although this idea seems simple on the surface, as soon as detailed research is done, it will become counterintuitive to intuition. In theory, two countries that can produce two goods at different costs can gain maximum benefit from relatively favorable exports of goods.

Trade promotes intergovernmental growth through the use of comparative advantage due to the strong correlation between openness of the trade balance and economic growth and the impact on economic performance. In addition, there is a strong positive correlation between capital flow and its impact on economic growth. The influence of foreign direct investment on economic growth, together with the increase of trade and foreign direct investment, brought positive positive growth effect in rich countries, leading to higher growth rate. Empirical studies that examined the impact of several factors of globalization on growth using time series data and cross-sectional data on trade, foreign direct investment, portfolio investment have low degrees of globalization. Further evidence, like most developed countries, suggests that wealthy countries have positive growth effects.